China's STAR50 Sinks 40%, Erasing $480 Billion in AI Selloff
Updated
Updated · Reuters · Oct 26
China's STAR50 Sinks 40%, Erasing $480 Billion in AI Selloff
3 articles · Updated · Reuters · Oct 26
Summary
$480 billion has been wiped from China's AI-heavy STAR50 index since its July peak, a four-month slide that Reuters says has already burst the country's AI stock bubble.
High valuations, doubts about AI demand, tax bills and fears of new U.S. or allied curbs on Chinese equipment for data centres drove the reversal, even without a single clear selling trigger.
Retail-favourite names have been hit hard: Unitree has halved since its August debut, while optical parts makers Zhongji Innolight and Eoptolink are down about 60% from summer highs.
The selloff threatens Beijing's effort to channel household savings into equities and could choke tech fundraising and listings, with the broader CSI300 also down about 20% from June highs.
Even after the rout, the STAR50 trades near 100 times trailing earnings versus about 30 for the Nasdaq 100, leaving investors wary that losses may not be over.